New Home and Garden research: What is it telling us?

Euromonitor International’s Home and Garden system launched Monday. The newly published research reveals many significant findings.

The global Home and Garden market reached sales of US$941 billion in retail value terms in 2011. Growth of 8% was higher than the previous year, with developing countries playing an increasingly important role underpinning sales growth.

That said, developed countries remain the largest spenders on Home and Garden products by far.  Indeed, Germany, Switzerland, the Netherlands and Australia spent in excess of $2,000 per household in 2011.

Gardening proved to be the most resilient category in 2011, delivering the strongest growth performance in many markets. Remarkably, this was also the case in several developed countries from Spain to Japan. Ageing populations, the rising popularity of outdoor living, and trends like “grow-your-own” all contributed to growth in these countries where slow economic recovery continues to constrain consumer spending in other categories.

In contrast to many consumer markets where grocery channels dominate, the position of specialist retailers remains unassailable in Home and Garden. Together DIY, Home Improvement and Garden Centres, as well as Furniture and Furnishings Stores account for two thirds of global retail sales.

Direct selling is a key distribution channel for Homewares in many emerging markets. In Argentina it accounts for 10% of total sales, and in the Philippines a significant 24%.

Looking forward, Home and Garden is set to deliver a polarised performance over the next five years.  Only China is expected to report double digit growth by through to 2016 while several developed countries, including high spenders Switzerland and Australia, will contract. On a broader industry level, it is anticipated that total revenue will increase by 3% CAGR, with Asia Pacific becoming accounting for an increasing share, with 7% CAGR.

Inter Ikea Systems BV was the largest Home and Garden company in 2011 with 3.3% global retail value sales.  The industry is very fragmented and Ikea was the only company able to achieve more than 1% of total value sales in 2011. Its wide geographical footprint and large store format have made it the global leader.